When the first slip in resale home prices in more than 18 months hit Las Vegas, some pundits blamed greedy sellers for unrealistic asking prices; others said prices have hit a seasonal peak before the normal holiday slowdown. And then there were those wondering if we’re seeing a new bubble.
On the surface, we seem very bubble-worthy. A median September resale price of $180,000—1.1 percent lower than August’s $182,000—is still 29 percent higher than a year ago. That’s not normal appreciation by any means. Most real estate agents expect more modest price gains ahead.
So the question still looms over whether Valley homes are inflated. And what will home-buying look like after another suspicious run-up?
Las Vegas’ prices still look appealing compared with other large city markets, says Dave Tina, president of the Greater Las Vegas Association of Realtors. Out-of-state retirees, in particular, see a good value in our homes. Of the cash buyers—47 percent of sales—we might be surprised at how many are not investors but retirees, Tina says.
As for working and middle-class Las Vegans nudged out of the market by cash buyers, he says the bidding wars are over, and there’s more supply out there. That’s good news for the average Southern Nevadan, who now makes $675 a week in the private sector, compared to the national average of $820. (Both figures sat around $725 before the recession started.)
Some Las Vegans are finding a way back into homeownership, even with smaller paychecks. And with lower prices than the 2006 median price peak of $315,000, the dollars in their pockets at least seem to still have more purchasing power today. Let’s just hope those cash-carrying retirees keep a cool head at the negotiating table.